METALS-London copper starts August weaker on U.S. tariff threat

MANILA, Aug 1 (Reuters) - London copper slid more than 1 percent on Wednesday, after losing nearly 5 percent last month, with risk appetite curbed by news that the Trump administration may propose a higher 25 percent tariff on $200 billion of Chinese imports.

Zinc was the hardest hit among metals, falling 2 percent, with nickel, lead and tin also sliding.

President Donald Trump’s government had initially announced it would seek to impose a tariff of 10 percent, and raising the level to 25 percent would escalate the dispute over trade between the world’s two biggest economies.

A source familiar with the plan said the administration could announce the tougher proposal as early as Wednesday.

“A revival of the trade war rhetoric by the U.S. saw general risk reduction across most asset classes...with metals bearing most of the negativity,” Matt France, head of institutional sales for metals in Asia at Marex Spectron, said in a note.

Also weighing on sentiment was data showing that China’s manufacturing sector grew at the slowest pace in eight months in July as export orders declined.

Three-month copper on the London Metal Exchange was down 1.4 percent at $6,209.50 a tonne by 0727 GMT, after falling 4.9 percent in July. Zinc lost 1.9 percent to $2,577.50 per tonne, lead dropped 1.3 percent to $2,126 and nickel eased 1 percent to $13,895.

* CHINA DATA: The Caixin/Markit Manufacturing Purchasing Managers’ Index declined to 50.8 in July from June’s 51.0, matching economists’ forecast and a November 2017 level.

* ESCONDIDA: The union at BHP’s Escondida mine in Chile, the world’s largest copper mine, said that an early, partial vote count on a final contract offer from the Anglo-Australian miner suggests its members will reject the offer and approve a strike.

* CASERONES: The main union at Chile’s Caserones mine has rejected operator Lumina Copper’s final contract offer and workers have approved strike action, the union’s president said.